Analyzing KKR Real Estate Finance Trust (KREF) & Dynex Capital (DX)

KKR Real Estate Finance Trust (NYSE: KREF) and Dynex Capital (NYSE:DX) are both small-cap finance companies, but which is the superior stock? We will contrast the two businesses based on the strength of their valuation, earnings, institutional ownership, profitability, risk, dividends and analyst recommendations.

Earnings and Valuation

This table compares KKR Real Estate Finance Trust and Dynex Capital’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
KKR Real Estate Finance Trust $41.19 million 26.08 $31.15 million N/A N/A
Dynex Capital $91.90 million 5.01 $43.09 million $1.44 4.87

Dynex Capital has higher revenue and earnings than KKR Real Estate Finance Trust.

Analyst Recommendations

This is a summary of current ratings and recommmendations for KKR Real Estate Finance Trust and Dynex Capital, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
KKR Real Estate Finance Trust 0 3 0 0 2.00
Dynex Capital 0 2 1 0 2.33

KKR Real Estate Finance Trust currently has a consensus target price of $22.50, suggesting a potential upside of 12.44%. Dynex Capital has a consensus target price of $7.38, suggesting a potential upside of 5.21%. Given KKR Real Estate Finance Trust’s higher possible upside, equities analysts clearly believe KKR Real Estate Finance Trust is more favorable than Dynex Capital.

Insider & Institutional Ownership

65.7% of KKR Real Estate Finance Trust shares are owned by institutional investors. Comparatively, 44.7% of Dynex Capital shares are owned by institutional investors. 7.1% of Dynex Capital shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Profitability

This table compares KKR Real Estate Finance Trust and Dynex Capital’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
KKR Real Estate Finance Trust 77.41% 6.08% 0.75%
Dynex Capital 86.86% 11.08% 1.27%

Dividends

KKR Real Estate Finance Trust pays an annual dividend of $1.48 per share and has a dividend yield of 7.4%. Dynex Capital pays an annual dividend of $0.72 per share and has a dividend yield of 10.3%. Dynex Capital pays out 50.0% of its earnings in the form of a dividend.

Summary

Dynex Capital beats KKR Real Estate Finance Trust on 9 of the 13 factors compared between the two stocks.

About KKR Real Estate Finance Trust

KKR Real Estate Finance Trust Inc is a real estate finance company that focuses primarily on originating and acquiring senior mortgage loans secured by commercial real estate assets (CRE). KKR manages investments across multiple asset classes, including private equity, real estate, energy, infrastructure, credit and hedge funds. The Company’s investment strategy is to originate or acquire senior mortgage loans collateralized by institutional-quality CRE assets. Its target assets also include mezzanine loans, preferred equity and other debt-oriented instruments. The Company’s investment objective is capital preservation and generating attractive risk-adjusted returns for its stockholders over the long term, primarily through dividends.

About Dynex Capital

Dynex Capital, Inc. is an internally managed mortgage real estate investment trust, which invests in residential and commercial mortgage securities on a leveraged basis. The Company’s objective is to provide attractive risk-adjusted returns to its shareholders over the long term that is reflective of a leveraged fixed income portfolio with a focus on capital preservation. It seeks to provide returns to its shareholders through regular quarterly dividends and through capital appreciation. It invests in Agency and non-Agency mortgage-backed securities (MBS). MBS consists of residential MBS (RMBS), commercial MBS (CMBS) and CMBS interest-only securities. Agency MBS have a guaranty of principal payment by an agency of the United States Government or a government-sponsored entity (GSE), such as Fannie Mae and Freddie Mac.

Receive News & Ratings for KKR Real Estate Finance Trust Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for KKR Real Estate Finance Trust and related companies with MarketBeat.com's FREE daily email newsletter.

Latest News

Leave a Reply